PARICHHAN MISTRY (DEAD) BY LRS. AND ANR. versus ACHHIABAR MISTRY AND ORS.

Citation: [1996] SUPP. 5 S.C.R. 161 · Decided: 23-08-1996 · Supreme Court of India · Bench: K. RAMASWAMY · Disposal: Appeal(s) allowed
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Judgment (excerpt)

PARICHHAN MISTRY (DEAD) BY LRS. AND ANR. 
A 
v. 
ACHHIABA,R MISTRY AND ORS. 
AUGUST 23, 1996 
(K. RAMASWAMY AND G.B. PATTANAIK, .J.J.) 
Transfer of Property Act, 1882: Section 60 proviso: 
Usuftuctuary m01tgage-Redemption of-Right of mortgagor-'Act of 
parties'-M01tgagor defaulted in payment of rent in respect of holding-Decree 
obtained by landlord and in exewtion thereof property put to sale-Mortgagee 
paid decretal amount-Held: any advantage gained by mortgagee by availi11g 
himself of his position was held by him for be11efit of m01tgagor-Even if 
mortgagee paid decretal amount still m01tgagor's 1ight of redemption was not 
extinguished. 
The appellants-mortgagor filed a suit for redemption of land in 
respect of which a usufructuary mortgage has been executed in favour of 
the respondents-mortgagee. The respondents had taken the stand that 
under the Mortgage Deed the mortgagor was liable to pay rent in respect 
B 
c 
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of the holding and no rent having been paid, in a suit instituted by the E 
landlord for arrears of rent, a decree had been obtained and in execution 
thereof the property had been put to sale and the mortgagee paid the 
decretal amount in question and, therefore, a suit for redemption would 
not lie. The trial court decreed the suit, the appeal against it was dis-
missed. The High Court allowed the second appeal filed by the respon-
dents. Being aggrieved the appellants preferred the present appeal. 
Allowing the appeal, this Court 
F 
HELD : 1.1. It is true, that a right of redemption under a Mortgage 
Deed can come to an end, but only in a manner known to law. Such G 
extinguishment of right can take place by contract between the parties or 
by a decree of the court or by a statutory provision which debars the 
mortgagors from redeeming the mortgage. The mortgagor's right of 
redemption is exercised by the payment or tender to the mortgages at the 
proper time and at the proper place, of the mortgage money. When it is 
extinguished by the act of parties the act must take the shape and observe H 
161 
162 
SUPREME COURT REPORTS (1996] SUPP.5S.C.R. 
A 
the formalities which the law prescribes. The expression "Act of parties" 
refers to some transaction subsequent to the mortgage and standing apart 
from the mortgage transactio111. A usufructuary mortgagee cannot by mere 
assertion of his own or by a unilateral act on his part, convert his position 
on moiety of the property ~s mortgagee into that of an absolute owner. 
B 
[164-E-H] 
1.2. It is no doubt trm~ that the mortgagee would be entitled to 
purchase the entire equity of redemption from the mortgagor. The 
mortgagee occupies a peculiar position and, therefore, the question as to 
what he purchases at a Court sale is a vexed question, but being in an 
advantageous position where tlh.e mortgagee availing himself of his position 
C gains an advantage he holds, such advantage is for the benefit of the 
. mortgagor. Therefore, if for some default in payment of rent, a rent decree 
is obtained and the mortgage1e pays off the same even then the mortgage 
in question is liable to be red.eemed at the option of the mortgagor. The 
mortgage~, cannot escape from his obligation by bringing the equity of 
D redemption to sale in execution of a decree on the personal covenant. By 
virtue of purchase of the property by the mortgagee in Court sale, no 
merger takes place between the two rights nor the mortgage stands extin-
guished. [163-H; 164-A-C] 
Sidhkamal Nayan v. Bira Nayak, AIR (1954) SC 336 and Mirtunjuoy 
E Pani v. Nannanda Bala Sasmal, [1962) 1 SCR 290, relied on. 
F 
G 
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 3902 of 
1987. 
From the Judgment and Order dated 28.7.80 of the Patna High Court 
in Appeal from Appeal Decn!e No. 899 of 1974. 
;. 
K.K. Rai and Ranjan Mukherjee for the Appellants. 
M.K. Choudhary and S.K. Verma for the Respondents. 
The Judgment of the Court was delivered by 
PATfANAIK, J. This appeal by the mortgagors is directed against 
the judgment of the Patna High Court dated 28th of July, 1980 in the 
Second Appeal arising out of a suit for redemption. The plaintiffs/appel-
H lants filed a suit for redemption of 2 bighas 3 kathas and 6 dhurs of land 
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PARICHHANMISIBYv.ACHHIABARMISIBY(PAT.fANAIK,J.] 
163 
in respect of which a usufructuary mortgage bond Exhibit No. 1 dated 4th A 
May, 1980 had been executed in favour of the defendants. The defendants 
had taken the stand that under the Mortgage Deed the mortgagor was 
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